By Steve Goldstein, MarketWatch
British stocks surged on Tuesday after the U.S. Federal Reserve surprised markets with an intra-meeting half-point rate cut.
The rate cut — hours after a Group of Seven statement that left it to each country for fiscal and monetary policy in the wake of the coronavirus — sent the FTSE 100 /zigman2/quotes/210598409/delayed UK:UKX +0.62% up by 2.3%, putting the index on track for its best one-day percentage gain since May 8, 2015.
The Bank of England also is expected to cut interest rates at its regularly scheduled meeting at the end of the month, though only by a quarter-point, as its current base rate is just 0.75%. The British pound /zigman2/quotes/210561263/realtime/sampled GBPUSD -0.7249% jumped after the U.S. rate cut on the narrowing interest-rate differentials.
FTSE 100 gainers included hard-hit British Airways owner International Consolidated Airlines /zigman2/quotes/208070069/delayed UK:IAG +3.38% which jumped 9.2%, and Scottish Mortgage Investment Trust /zigman2/quotes/204858474/delayed UK:SMT +3.69% , which rallied nearly 6%.
Of stocks in the move in London, direct marketer 4imprint Group /zigman2/quotes/207133667/delayed UK:FOUR +0.43% surged 17% after reporting a 22% pretax profit rise, hiking its dividend by 20% and saying trading in the first two months of 2020 have been in line with expectations.
Industrial equipment maker Rotork /zigman2/quotes/200372942/delayed UK:ROR +1.65% climbed after reporting a 2.9% increase in adjusted pretax profit rise despite a 3.8% revenue decline. Analysts at UBS said the company’s controls division benefited from procurement and productivity savings.
Direct Line Insurance /zigman2/quotes/201952264/delayed UK:DLG -1.14% rose 4.5% as the car insurer reported a 10% drop in operating profit in 2019 — which wasn’t as steep as analysts had forecast — alongside a 2.9% dividend increase and a £150 million stock buyback program.
Finablr /zigman2/quotes/211632366/delayed UK:FIN 0.00% shares slumped by a double-digit percentage for the second straight day. On Monday, Finablr said its Travelex unit’s underlying operating will be hurt by £25 million due to the cyber attack, though it did note that a cyber-insurance policy will eventually offset a “material proportion.” Travelex is also being hurt by a lack of travel from the coronavirus.